Best Used Cars: How to Find a Dependable, Affordable Vehicle

by Jerry Edgerton

When it comes to thrifty car shopping, searching out a dependable used car at the right price often produces the best value. But as rising used-car prices change the market, you need to research your choices more carefully. In some cases, new cars can cost less to buy and own than one-year-old used ones. If a used vehicle makes sense for you, know which models are the most reliable and the best buys.

The latest data from auto information site Edmunds.com show used-car prices 10% higher than one year earlier, with some used SUVs up by 30%. "A lack of confidence in the economy is driving more people to used cars, putting upward pricing pressure on a limited supply of vehicles," says Joe Spina, an Edmunds analyst. The low level of new-car sales by historical standards means fewer trade-ins to sell as used cars.

Nonetheless, for most bargain-seeking car shoppers, used vehicles still make sense. "One- and two-year-old used cars are no longer radically cheaper than new cars," says Mark Scott of AutoTrader.com, the largest online site for advertising new and used cars. "If you get models older than two years, it is cheaper to buy used."

Check reliability, history

When used-car shopping, you need to know two things: the reliability record of a particular make and model and the history of the particular vehicle you are considering. For the history, check a service like Carfax ($34.99 for one report, $44.99 for five) to see if the odometer reading makes sense, how many owners the car has had, and if it has ever been in an accident reported to police. If you're buying a used car from a new- or used-car dealer, the dealership should show you such a report.

As for model reliability, two organizations measure that. The 2010 J.D. Power Vehicle Dependability Study is a guide to three-year-old vehicles that have had the least trouble. J.D. Power researchers assemble data from 52,000 owners who bought new 2007 models to see which vehicles experienced the fewest problems. Domestic U.S. brands performed better than they did in past surveys. The top five brands for reliability are Porsche, Lincoln, Buick, Lexus, and Mercury. Ford and Cadillac also finished with above-average ratings. The study also gives reliability ratings to individual models.

"If you get models older than two years, it is cheaper to buy used."

Additionally, Consumer Reports picks the best and worst used cars and rates individual models based on surveys of its readership, available in its annual April issue or online if you subscribe.

Based on those two sources, we have selected good candidates in five categories. They must be among the most reliable in their categories in the Power survey and get an above-average used-car rating from Consumer Reports. We discuss 2007 models to square with the Power sample, but often the same vehicles will be reliable for adjacent years, say 2006 or 2008.

Here are those selections with prices. These are listed selling prices from dealers according to automotive pricing site NADAGuides.com, assuming 40,000 miles on the vehicle. Buying these models from a private party would cost less—as would cars with more miles traveled. And these listed prices may be negotiable.

Small cars

The first model year of the popular Honda Fit, with its nimble handling, commodious cargo room, and good gas mileage (rated at 33 miles per gallon [mpg] in city driving, 38 mpg on the highway), is priced at an average $12,050 on dealer's lots with automatic transmission. If you don't mind owning a brand that's being discontinued, the Pontiac Vibe sporty small wagon gets strong reliability rankings and has mileage ratings of 26 mpg in city driving, 33 mpg on the highway. It was selling recently for $12,650 with automatic shift.

Midsize cars

Buick LaCrosse is a comfortable family sedan that tops its category in the Power ratings. Its V-6 engine is rated at 19 mpg in city driving, 27 mpg on the highway. The LaCrosse is priced between $14,175 and $16,325, depending on the trim level. The Mercury Milan—another disappearing brand—also gets strong used-car ratings. Its V-6 version, rated at 20 mpg in city driving, 28 mpg on the highway, is priced at $14,525.

Small crossover SUVs

Honda CR-V tops the Power ratings in this class and ranks among Consumer Reports' best used cars. Its four-cylinder engine is rated at 23 mpg city, 30 mpg highway. The two-wheel drive automatic version is priced at $19,575. Subaru Forester also gets good ratings in this category. Like all Subarus, it comes with standard all-wheel drive and is rated at 22 mpg city, 29 mpg highway. The base version with automatic transmission is selling at $16,425.

Know the reliability record of a make and model and the history of the vehicle you are considering.

Midsize SUVs

Toyota Highlander tops this Power category and got a well-above-average used-car rating from Consumer Reports. The 2007 Highlander was not involved in Toyota's sudden acceleration recalls, though later models were. The V-6, two-wheel drive version, rated at 19 mpg city, 25 mpg highway, is priced at $19,225. Nonetheless, if you are leery of Toyota models, the Honda Pilot gets an above-average used-car rating from Consumer Reports, although it was rated as average in the Power survey. Rated at 18 mpg city, 24 mpg highway, the EX two-wheel drive version is priced at $20,850.

Minivans

Toyota Sienna dominates reliability ratings in this category. The Sienna was not involved in the Toyota sudden acceleration recalls. Like all minivans, pricing varies considerably from the base model to fully loaded—all were rated at 19 mpg city, 26 mpg highway, with a V-6 engine. The base CE model was selling recently at $17,400, while the top XLE was priced at $22,875. No competitor gets above-average used-car ratings from either source.

Unlike new cars, every used car is different. So if you're shopping, start with reliable models and then be sure to check the history of the one that catches your eye.

Jerry Edgerton is an automotive writer whose work has appeared in Money and other national magazines. He also is the author of "Car Shopping Made Easy."